Long bones are morphologically complex structures. When they begin to form in the embryo, they are entirely cartilaginous. The chondrocytes then undergo maturation, involving a proliferative, prehypertrophic and hypertrophic phase. Once formed, hypertrophic cartilage is invaded by perichondrial cells and replaced by endochondral bone. Perichondrial cells produce also an intramembranous bone collar around prehypertrophic and hypertrophic cartilage that determines size and shape of the shaft. Thus, long bone formation involves a multi-step chondrocyte maturation process, intramembranous and endochondral ossification, and topographically related events in cartilage and perichondrial tissues. It is far from clear how all these processes and events are regulated. Indian hedgehog (IHH) and retinoids are powerful signaling molecules. Studies from this and other groups have suggested that IHH, a product of prehypertrophic chondrocytes, influences chondrocyte proliferation and intramembranous bone collar formation and inhibits hypertrophy. On the other hand, retinoids which are present in hypertrophic cartilage and surrounding perichondrial tissue, stimulate hypertrophy and endochondral bone formation. These and many additional data indicate that IHH and retinoids are signaling molecules regulating steps in chondrocyte maturation and coordinating events in cartilage and perichondrial tissues. Our central hypotheses are: (A) IHH is a direct inducer of chondrocyte proliferation and intramembranous collar formation, and an inhibitor of chondrocyte hypertrophy; and (B) Retinoids shut off IHH expression, stimulate chondrocyte hypertrophy, and permit endochondral ossification. This project aims to determine how IHH and retinoids exert these distinct but interrelated roles and thus allow normal progression of long bone development. We will use avian and murine animals, microsurgical limb manipulations, and cell cultures to analyze: (a) expression and function of receptors and nuclear mediators of IHH and retinoid action; (b) pathways of synthesis, degradation and delivery of retinoids; and (c) effects of ectopic protein expression. We will also determine whether abnormalities in above mechanisms underlie the defects in long bones seen in IHH- null mice. The results will provide much needed information on the regulation of long bone formation, and will have relevance to questions of skeletal growth, fracture repair and congenital conditions of cartilage and bone.